Coinbase Launches cbADA: Bringing Cardano to Ethereum’s DeFi via Base Layer 2
Coinbase has launched cbADA, a wrapped version of Cardano’s native token, on its Base Layer 2 network. The crypto exchange announced the launch on June 25, 2025, alongside cbLTC (wrapped Litecoin), marking a significant milestone in cross-chain interoperability. This strategic move connects Cardano holders directly to Ethereum’s expansive DeFi ecosystem without requiring them to sell their native ADA holdings.
cbADA Wrapped Token Mechanics and Security
Each cbADA token maintains a 1:1 ratio with the original ADA stored in Coinbase custody, ensuring full backing and transparency. The wrapped token operates as an ERC-20 standard asset, enabling seamless integration with Ethereum-compatible applications and protocols.
Coinbase provides transparent proof of reserves (PoR) that demonstrates the custodian holds 1:1 reserves of ADA backing each cbADA token. The transparency pages display the on-chain addresses securing the collateral, with current data showing 2,963,259.36 ADA already issued on Base.
The minting and burning process operates automatically through Coinbase’s infrastructure. Users can transfer ADA to Base addresses where tokens are automatically converted to cbADA, with conversions working in reverse for redemption.
Base Layer 2 Network Strengthens DeFi Position
Base has rapidly emerged as a leading Ethereum Layer 2 platform, now securing over $12 billion in total value and ranking second among Layer 2 solutions. The addition of cbADA and other wrapped assets enhances Base’s role as a cross-chain liquidity hub.
The ERC-20 versions of ADA enable Cardano holders to access Ethereum-style DeFi via the Base network, opening doors to lending protocols, automated market makers, and yield farming opportunities previously unavailable to ADA holders.
Market Response and Initial Adoption
According to Coinbase’s proof-of-reserves data, cbADA reached an initial supply worth approximately $1.7 million within 24 hours of launch. This rapid adoption demonstrates strong market demand for Cardano’s entry into Ethereum DeFi.
The wrapped token approach allows Cardano community members to maintain exposure to ADA while participating in Base’s growing DeFi protocols. As institutional interest grows and retail users seek more utility, cbADA serves as the bridge between two major blockchain ecosystems.
Strategic Implications for Cardano DeFi Integration
Coinbase’s cbADA launch represents more than a technical integration—it signals a fundamental shift toward blockchain interoperability. The initiative brings Cardano into Ethereum-compatible DeFi without requiring users to sell their native tokens, preserving the integrity of the Cardano ecosystem while expanding utility.
The wrapped token model addresses a critical challenge in the cryptocurrency space: accessing DeFi opportunities across different blockchain networks. Previously, Cardano holders faced limited options when seeking yield opportunities or liquidity provision outside their native ecosystem.
Conclusion
Coinbase’s cbADA launch on Base Layer 2 opens new possibilities for Cardano holders seeking DeFi participation. The 1:1 backing mechanism, transparent proof of reserves, and seamless ERC-20 integration create a secure bridge between Cardano and Ethereum’s financial infrastructure. This development positions both Base and Cardano for increased adoption as the DeFi landscape continues expanding across multiple blockchain networks.
